Business Shares as Marital Property

By
Roscich & Martell Law Firm, LLC
|December 22, 2017

One marital asset that can become difficult to
divide and distribute in a divorce is a spouse’s share in a business. Even
when a spouse may have owned a business before marriage, some parts of
the business may be considered marital property and be divided as such.

Generally, if a person owns a business before marriage, the business and
the assets in the business are considered nonmarital property. However,
as the business grows and becomes more successful, the increase in the
business value and newly acquired assets may become marital property.
In order to determine the amount of the business that would be required
to be divided as marital property, the business would need to be valued
for its current worth.

The commingling of business assets with marital assets is also something
that may factor into whether or not a business interest can be divided
as a marital asset. For example, if marital funds were used to pay for
business debts, the spouse who does not own the business can argue that
the business is marital property.

A spouse’s nonmonetary contribution to the business is also considered.
For example, a court can consider the efforts of the spouse who does not
own the business working on a marketing campaign or working as the receptionist
for the business without pay in order to make the business a success.

If the business is deemed marital property, dividing the value of the business
could mean dissolving or selling the business. If it comes to that, the
spouse with an interest in the business can offer to give the other spouse
other assets in exchange for leaving the business intact. If the spouses
jointly own a business, they can decide to continue operating it together,
with new documentation drawn up to designate each spouse’s ownership
interest in the business.

Spouses who own businesses or are a part of a family business before they
get married can try to reduce the chances that their business will be
divided as marital property in a divorce through the use of a premarital
agreement. The spouse would also have to maintain the business accounts
separately from the marital accounts, in order to avoid the characterization
of the business assets as marital property.

Contact an Attorney for Legal Assistance

To find out more about how a divorce can affect your business interest,
you need to speak to an experienced divorce lawyer. A divorce lawyer can
work with other professionals to evaluate your business and advise you
as to which property would be marital or nonmarital property. For more
information on property division and other divorce issues, contact the
Naperville divorce attorneys at the Roscich & Martel Law Firm, LLC for a consultation.

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